Insuring the safety of your children

As parents protecting our children is always a main concern. Child car seats and stair gates are invaluable for preventing bumps and bruises but it's also worth considering insurance in case of more serious accidents. my child offers advice on the best packages for the family - from life assurance to accidental damage extension

Life assurance

Top of the list is life assurance. With this, if you die during the term of the policy it will pay out a lump sum, which can be used to provide for your child and spouse.

Putting a figure on your life isn't easy, but Kevin Carr, head of protection strategy at independent financial advisers Lifesearch, has the following advice: ‘Take out enough to cover all your debts such as your mortgage, credit cards and any loans. Then allow a further £150,000 for every child, more if there are school fees involved.' Even with such large figures, insuring your life is relatively cheap, especially if you're still young. For example, £150,000 of life assurance for a 25-year term will cost a 30-year-old male around £10 a month, while a 25-year-old female would pay around £7.50 a month.

Income protection

As well as looking after your family if you die prematurely, it's also worth taking out insurance if you're unable to work. Income protection provides a replacement income if you are unable to work due to illness or an accident.

Although full blown income protection cover, which kicks in as soon as you're unable to work is expensive, there are ways to cut the cost. You can reduce the amount you receive - the maximum you can get is roughly two thirds of your salary but you might not need this much if you're not working.

Additionally you could take a policy with a longer deferred period. This is the waiting period before the policy pays out and, if you have sufficient savings, you can reduce your premiums by going for a three-month or longer deferred period. It's also worth speaking to your employer as they may help provide some protection.

Income protection isn't restricted to the breadwinner either: home carers can also have cover. Some policies also include cover if your children are ill so you can take time off work to look after them.

Family income benefit

A variation on life assurance that might be worth considering is family income benefit. Rather than paying a lump sum this provides an income for the rest of the term. It's generally around two thirds the price of life assurance, and takes away the worry of having to invest a lump sum.

Family insurances

In addition to increasing the need for protection products, having a family can also affect the way you insure your home and holidays. Graeme Trudgill, manager of technical services at the British Insurance Brokers' Association (Biba) says ‘it's worth taking out an accidental damage extension on your home contents insurance, this could cost around 15 per cent more but it may be well worth it.' Graeme also recommends including personal possessions cover on your home insurance. This pays if items are lost or stolen away from the home.

As your children get older your choice of travel insurance can also become important. ‘If your child is likely to go travelling on their own, make sure your policy includes cover for this,' explains Graeme. Among those allowing them to travel on their own are Biba, Tesco and Churchill.

Critical illness insurance

Critical illness is another insurance option you might want to consider. This pays out if you are diagnosed with a serious illness such as cancer or heart disease. Around £8 a month will get a 30-year-old £20,000 of cover over a 25-year term. ‘It's not as high a priority as income protection but it could be useful if you are seriously ill to pay for anything from medical treatment, care or time off work,' explains Kevin.

It's common for these policies to include some child cover too. Typically this would pay out 25 per cent of your sum assured up to a maximum of £25,000. ‘Thankfully the chances of something dreadful happening are only small,' says Kevin, ‘but for a relatively small monthly premium you can get the peace of mind that whatever happens your family will be looked after.'